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JOHN KING, USA

Clock is Ticking; High Cost of Tax Cuts; Outrage over Earmarks; Health Reform Lawsuit; Senate Votes to Pull Spending Bill

Aired December 16, 2010 - 19:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


JOHN KING, HOST: Thanks Suzanne and good evening everyone. Tonight the president releases a new report on his Afghanistan strategy and he claims progress. But many in Congress think the White House is glossing over the giant challenges. We'll debate whether the president's time line for withdrawing the troops is too fast or not soon enough.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Otherwise it's a sinkhole, it's a quagmire and as many writers have famously said, it's a graveyard of empires and I don't want my country going down that hole.

(END VIDEO CLIP)

KING: And we know the question of whether to repeal the military's "don't ask, don't tell" policy divides Senator John McCain and his daughter, Megan, but what about McCain's son? Does combat veteran Jimmy McCain agree with the Marine Commandant's harsh warnings against repeal?

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: I'm very reluctant to discuss my children's views.

(END VIDEO CLIP)

KING: Stay with us and you'll hear Jimmy McCain's views just ahead, but let's begin with your money and a bit of political chaos on the question of whether the House will pass the tax cut deal President Obama negotiated with congressional Republicans. Most liberals don't like what they see as a multibillion dollar giveaway to wealthy Americans that will only add more pressure in the name of deficit reduction to cut other programs that help middle class families and the poor.

(BEGIN VIDEO CLIP)

REP. DONNA EDWARDS (D), MARYLAND: So irresponsible it contradicts everything as Democrats that we've been fighting for, for generations.

(END VIDEO CLIP)

KING: Well because of that Democratic anger the tax bill was pulled from the floor earlier today because Speaker Nancy Pelosi wasn't sure she had enough to pass it. But look now. There's a live picture of the House back in session with a final vote on that tax bill now expected late tonight, perhaps after midnight and across the Capitol, wala (ph), the Senate back in session tonight, too.

They're going to deal with a massive spending bill. The Republicans call it a monstrosity, yet it also has dozens and dozens of Republican-backed earmarks. Go figure. As we track the debates and the votes, we've got a great group to help. CNN contributors James Carville, Erick Erickson and John Avlon -- that would be left, right and center -- and with me here in Washington our senior political analyst Gloria Borger and national political correspondent Jessica Yellin. Before we debate though, let's get a quick update on the Senate read-a-thon that's about to begin from our congressional correspondent Brianna Keilar -- hey Brianna.

BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Hey there, John. It is about to kick off and just take a look at what we're talking about. This is the spending bill that the Senate clerk is going to be reading. It is almost 2,000 pages and according to Dick Durbin (ph), the number two Democrat in the Senate, it's going to take between 30 and 60 hours to read.

That puts us maybe well into Saturday going around the clock here before it's read. And right now this is because Republican Senator Jim DeMint is trying to run out the clock during this lame duck Congress while Senate Democrats are struggling to get as much done as they can and then you have Senate Majority Leader Harry Reid now calling Republicans hypocrites because of what you talked about, John, those Republican earmarks in this spending bill that Republicans are now saying they -- some of them are saying they don't want to vote on because of the earmarks in it.

And then moving over to the House, also a bit of a marathon there, we're not expecting to see a vote or votes on extending the Bush era tax cuts until after midnight tonight. This all centered around downright revolt, really, from liberal Democrats who say they were feeling jammed by Democratic leaders who were only going to give them one chance to change this bill which would have been to change the estate tax provision and make it perhaps less generous to wealthy Americans.

Well, as it turns out, they said they want more than that even though it's looking like they're not going to be able to secure any changes. What they're looking for is to send a message and they're going to get one or two more votes and they wanted to send a couple messages, perhaps, that they really don't like this bill -- John.

KING: All right, Brianna Keilar tracking both the House and the Senate. At least we know, Bri, if you're waiting for votes you have got plenty of reading material (INAUDIBLE).

(LAUGHTER)

KING: All right, let's start -- let's start our conversation on the House side, ladies and gentlemen. And James Carville, I want to go to you first because this is a tough one. This is a very tough one. There's a lot in this bill the Democrats don't like, especially liberal Democrats and they know Speaker Pelosi has the gavel right now for a couple more weeks and yet the president is asking them, I need you to do this for me and they don't want to.

JAMES CARVILLE, CNN POLITICAL CONTRIBUTOR: Well they don't but they're going to do it after midnight, so it may now. It doesn't strike me as being the end of the world, that it will take another 24 hours to pass it. Look, why would anybody be for the estate tax -- it's not going to create a single job and it's going to cost money. If somebody can't get by with $5 million (INAUDIBLE) that's too bad.

KING: All right. So let's listen to some of this debate. Louise Slaughter, she's the chairwoman of the Rules Committee, again for a couple of more weeks, she is the one that had the problem today. They wrote a rule for this debate. They thought they were going to get this thing passed this afternoon, but enough Democrats said no, no, no, and she said she understands the complaint. She says this is what the Democrats are being asked to do and what the Republicans want and the president wants, well, fantasy land.

(BEGIN VIDEO CLIP)

REP. LOUISE SLAUGHTER (D), NEW YORK: To try to pretend to the American people that once we pass this great tax cut for the rich that jobs are suddenly going to rain on us makes us feel like Alice in wonder land, able to believe 10 impossible things before breakfast. I am just not one of them.

(END VIDEO CLIP)

KING: Now, Jess, at stake here is whether these tax cuts get extended. We know in the end they will -- all of them and the liberals don't like that. But what you also sense here is just the begrudging final days of Democratic majority and almost the reluctance to let go --

JESSICA YELLIN, CNN NATIONAL CORRESPONDENT: To let go. I mean there's so much frustration and anger but this is exactly why the Democrats didn't win in part in the midterms because people get the sense that they're not getting the business done. They're not given a clear message. They don't know where they're standing -- you know there's too much internal division.

Even what James just said this isn't going to create new jobs, well the Senate majority leader is saying the exact opposite thing. That this tax package will, so there's a lot of frustration that the Democrats aren't on one page.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: In truth, what they don't want to say is what they -- some really believe, which is that this is another stimulus package and that's an $858 billion stimulus package and the Democrats got a lot out of this including a payroll tax deduction, the extension of the earned income tax credit and tax cuts for small business that they really wanted, so why not declare victory and go home. KING: And one of the questions as we watch this play out, the tax cut debate in the House, then the big spending bill in the Senate, is this not just the substance and how the process works, but the tone, the animosity. Is that going to carry over into the New Year? Is it just raw emotion after the election, maybe understandable, or will it carry over when we have divided government?

And here is the case in point. Here is Senator Mitch McConnell saying what the Democrats are trying to put through and you just saw Brianna -- we've stacked it up two nights in a row here in the program, 1,900 pages, hundreds and hundreds and hundreds of earmarks in it. Mitch McConnell says big mistake.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: We're going to have an opportunity to do this. I would hope that it would make sense on a bipartisan basis. This one page continuing resolution on February the 18th is an alternative to this 2,000-page monstrosity that spends a half a billion dollars a page.

(END VIDEO CLIP)

KING: So what he's saying there is forget all the earmarks. Forget all the detailed written budget. Let's pass one page and says let's keep the government going at a certain funding level then we'll deal with it next year. By the way, the Republicans will have a lot more power then and Senator McConnell knows that. But Leader Reid says, you know what, go away.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER: You can't have it both ways. You can all look it up in the dictionary yourself but I'll bet if you went to "h" in the dictionary and found hypocrite, under that would be people who ask for earmarks but vote against them.

(END VIDEO CLIP)

KING: Not pretty, John.

JOHN AVLON, CNN CONTRIBUTOR: I've got to say I love that some of the consistent Tea Party activists are calling this hyporkcrisy (ph). And Mitch McConnell's $86 million of requests, in particular is a classic example. But I think the question becomes, do you want to move the business of the Senate forward and possibly get a vote on START or "don't ask, don't tell" or are we going to go read through this bill which really has become a monstrosity of a kind of arrogance that was repudiated in this election, a kind of overspending impulse that a lot of the appropriators do still have.

KING: And Erick, here is the test for the right. You were -- you did postings today saying vote against the tax cut plan. You don't like it because it raises the deficit. Vote against the spending plan because of all the earmarks and the pork in there. The question is, will the Republicans here, new and old, listen? Do they think the Tea Party energy, the Tea Party threat that was there in the campaign, does it last in government? So when you put these posts up on Red State, are you seeing the kind of response, the kind of activity that you saw during the campaign or maybe are these establishment guys right? Maybe will that peter out?

ERICK ERICKSON, CNN CONTRIBUTOR: Well, it depends. Among the old guys and frankly a lot of the guys who are leaving office, are having no impact whatsoever. The younger guys, yes, but then a lot of the younger guys won't be here until January. But among people like Marlon Stetsman (ph) who won a special election in Indiana, guys like that yes, you're starting to go get the message.

There's a lot of wavering I'm told this evening among House Republicans now that the Democrats are obstructing the tax compromise. A lot of them are thinking they can fall away from it. On the Senate side, you know the Mitch McConnell proposal, the one-page idea, was because they haven't passed a budget this year. The first time since '74, a budget hasn't passed Congress, continue this over until next year and get rid of it. But I agree with John though. I suspect that the earmarks in Kentucky have been over $100 million, we might not have seen that.

KING: And James, when you hear the bad blood, Harry Reid toward the Republicans, a lot of Democrats toward the president, you've won elections and you've lost elections. Is that just it's still raw and we'll go home for Christmas and then we'll come back and be grown up in the New Year or is this the new world order?

CARVILLE: Well it's the old world order. It's a continuation of the order we had before. I just want to make a correction. I never said that the tax bill would not create jobs. I said the estate tax was not. I was specifically addressing that. And I think it's a very important distinction.

And that is what the Democrats are hung up on. My objection to the bill is that all it does is double down on failure being a Bush tax cut. But the larger point, we had partisanship and we had this kind of acrimony before. We're having it now. I suspect we'll have it after first of the year. Also you know nine -- nine -- 9.5 percent unemployment and war is going bad, this is what one would expect it to look like. I mean to a lot of these people out in the country, a lot of these politicians (INAUDIBLE) this is not a happy time in America.

KING: All right --

AVLON: But, John --

KING: Go ahead.

AVLON: John, just take a step back from the politics in Washington and the anger on the far left and the far right and we see a lot of broad bipartisan support for this tax compromise, this balanced compromise with the tax cuts and the unemployment extension. So let's not lose sight of that. There are actually new "Wall Street Journal" polls showing a decisive shift of support in favor of the president and this compromise even though the extremes are unhappy about it.

BORGER: But it's not just the extremes. The parties can't get their act together. Republicans have divisions. Democrats have divisions about how to proceed, you know --

KING: Maybe we should be having cake and ice cream if the American people for this brief moment actually like what's happening in Washington this could be a big moment.

(CROSSTALK)

KING: All right, everybody stand by. Everyone is coming back when we come back. We'll break this down in a little more detail. It's not only a divide between the Democrats and the Republicans. This tax deal especially, it's an early divide between all the Republicans who'd like to be your next president.

(COMMERCIAL BREAK)

KING: More on the tax debate in a moment with an eye on how it is already a dividing line in the early 2012 Republican presidential field. But first the latest round in the legal debate over the Obama health care plan. Last week a federal judge in Virginia ruled a central provision of that law is unconstitutional.

Critics including a long list of Republican governors and attorneys general are hoping a federal judge in Florida concurs with that Virginia ruling. CNN's Brian Todd was on hand today as the case got a hearing -- Brian.

BRIAN TODD, CNN CORRESPONDENT: John, the indications we got here in this courthouse today was that this may not be the best week for President Obama's health care plan. This judge, Roger Vincent (ph), had his sharpest criticisms, his toughest questions for the government attorneys advocating for the president's health care plan. This is what he said about this key provision, this individual mandate that everybody has got to buy health insurance.

Judge Vincent (ph) said this, quote, "There are lots of alternatives to that without imposing on liberties or freedom of choice." Another comment he made was very telling about the current right that people have now not to buy insurance. He said, quote, "There are some people who have a different way of dealing with a situation and that is being taken away from them."

So it doesn't look great right now for that particular provision of the president's plan which is key to holding the whole thing up if it goes to the Supreme Court. I spoke to a law professor who was in the courtroom. He said looks like that provision is in some danger, at least in this court right now -- John.

KING: Brian Todd for us -- in danger in that court, in danger already in that Virginia decision, so likely heading to the Supreme Court with that one. And as that plays out, health care without a doubt will be a flash point in the next presidential campaign. But at the moment taxes and spending are causing friction, quite a bit of friction among the Republicans thinking about seeking the GOP nomination.

Here's a breakdown on the tax deal making its way through Congress right now -- for, Senator John Thune, he's thinking about running for president; Mike Huckabee, he ran last time, might run again; Newt Gingrich, he is for it. He's moving around the country; Tim Pawlenty, the governor of Minnesota; Mitch Daniels (ph), the governor of Indiana. They're all for it.

Hopefully we can show our viewers this -- against it, Rick Santorum, Mike Pence, Sarah Palin, and Mitt Romney. I guess that graphic is not ready. Erick Erickson, let's start with you since you're the guy on the right. How big of a deal is it that you have a roughly even divide so far among the people who are inclined to run for president?

ERICKSON: I think that pretty much reflects what's going on within the Republican Party right now as well. This is not going to be a hill to die on for anyone in 2012. I don't think you're going to start having Sarah Palin or Mike Pence or any of the others beating up on the guys who supported it. No one is going to remember what they're even talking about.

For right now, though, I think the most fascinating line though is that drawn by John Thune in the Senate with his kind of barbs towards Mitt Romney who had come out against it, trying to lay the field there. He's going to have a very tough time, frankly, as an incumbent senator running on this. Interestingly to me is a guy like Mike Huckabee coming out supporting this when he didn't have to support this. Newt Gingrich maybe so, but the dynamic here is Mike Huckabee versus Sarah Palin on this one is the one I'm keeping my eye on.

KING: I hate to use it because Senator Thune is not going to like it and I don't mean any disrespect, but he is, Jess, is he not in what I'll call the Bob Dole box?

YELLIN: Right.

KING: In that he's in the leadership. He's not the number one as Bob Dole was, but he's in the Senate leadership so he is supposed to do the bidding of the leadership, yet he is thinking of running for president which means he has to take a lot of positions, round up votes, cast votes, going to be very tough to defend in Iowa, New Hampshire and beyond.

YELLIN: And already there are a number of Tea Party groups that are saying they are keeping track of who will vote for this, who will vote for the tax cuts and they're keeping their eye on them because while there's not total unanimity of Tea Party groups, many of the powerful ones do not want a yes vote. And so that's something Senator Thune will have to explain as he tries to -- if he should he seek the 2012 election. It is a Bob Dole problem for him.

(CROSSTALK)

BORGER: There are going to be lots of votes cast between now and 2012 and I daresay that a lot of these people who support this are going to be able to vote for spending cuts and that will make some of the Tea Party folks a little bit happier.

KING: So, James Carville, you've run presidential campaigns. Does this matter? Here we are right after the midterm election, and look at this polling number right here. If you see a generic ballot, Obama against the generic Republican, it's 42 percent for the president, 39 percent for the probable Republican candidate, that's essentially a dead heat. If you match him up against Governor Romney of Massachusetts, 47 percent for Obama, 40 percent for Governor Romney.

Against John Thune -- we just mentioned -- senator from South Dakota, 47 percent to 27 percent, a lot of people just don't know John Thune. But against Sarah Palin -- everybody knows Sarah Palin -- 55 percent to 33 percent. The president gets his highest numbers there. My question to you, Mr. Carville, is does any of this matter specifically on the Palin question? Will Republican primary voters, will electability be an issue or is it about ideology?

CARVILLE: Electability is somewhat of an issue. I mean I'm supporting Sarah Palin --

(LAUGHTER)

CARVILLE: I'm all for her. Look, I'd like (INAUDIBLE) on this. I think this is a warm-up. I think the mother of all is going to be the debt limit that --

(CROSSTALK)

UNIDENTIFIED MALE: Amen.

(CROSSTALK)

CARVILLE: -- or something like that. I think that's going to be -- I think this is all foreplay here. The big event is getting ready to come up --

ERICKSON: I totally agree with James on that. What they do with the debt limit is going to make or break some of these guys. In particularly those in Congress right now and even some of the ones who are speculating that they'll vote for it depending on what deal they get cut from the Democrats, which I'm starting to think you're going to see some of the Republicans, new guys in particular, Mike Lee (ph) and Rand Paul come in and just flat out say they're not going to vote for the debt limit and which of these candidates will rise above that.

BORGER: But Rand Paul says he has got $500 billion of cuts in his back pocket that he's going to propose at the time of the raising of the debt limit, so we'll see.

AVLON: John, just getting back to those presidential polls you showed though, because I think they're very telling. I think they tell two things. One, the elephant in the room about 2012 right now is the Republicans have a pretty weak field compared to President Obama. And the other thing is, is that the bump we're seeing post this election I think it shows the political advantage that comes from the checks and balances of divided government. I think now that the Republicans control the House of Representatives, there is less of a sense of urgency especially among voters in the center because there's a sense that there's a check. There's a balance in place and President Obama benefits politically from that just as Bill Clinton did.

KING: When John says it's a wheat field, I don't remember, maybe James can jump in and tell me, where did Bill Clinton poll in the presidential race at this point back you know in the midterm election before he ran -- he ran the first time in '92? Do you remember that?

CARVILLE: I remember President Bush famously had an 88 (INAUDIBLE) 89 percent approval in March of 1991.

UNIDENTIFIED FEMALE: Right.

CARVILLE: But by November we'd won the special in Pennsylvania. Was it Howard McMillan (ph) or one of the British prime ministers said in politics a week is a year? Well by that token we got a lot of years in here. I think it's (INAUDIBLE) interesting and fun to talk about. I think John, Erick, Jessica, Gloria would agree that not overly telling right now. There's a lot going to happen and I think this debt limit, it's going to be a big one. It's one thing to say I got $500 billion in cuts. It's another thing to vote for them.

BORGER: But I think Sarah Palin's negative ratings actually are telling because that's something she's got to overcome. And when your negative ratings are around 50 percent as hers are, that's -- that's really tough.

ERICKSON: Kate Gosselin (ph) appears on TV with her every week --

(CROSSTALK)

UNIDENTIFIED FEMALE: We know what you're watching.

(CROSSTALK)

KING: But the one question I have about it is when you look at this and none of them are doing especially well, Romney does reasonably well this far out, but does it encourage others to say maybe I will run? You look at it -- one hand you say, wow there's a lot of people running. There's no room for me. Does it encourage somebody even like a -- forgive me here I go -- a Jeb Bush to say, you know why not?

YELLIN: I mean nobody thought President Obama was going to get in the race at this point. I think it was roughly -- by this point -- that last cycle. And, look, when you have so many of these key groups divided on these positions, FreedomWorks is one place on the tax cut, the Tea Party Express is another. There's so many -- there's so much fracturing it creates a lot of room for someone new to emerge.

ERICKSON: And remember 1992 or end of'9/11 -- go back to James's point -- people were talking about Mr. Sangas (ph) from Massachusetts as opposed to Bill Clinton.

UNIDENTIFIED FEMALE: I think I was one of those --

(CROSSTALK)

KING: Then they saw the Speedo in the pool in New Hampshire -- never mind --

(CROSSTALK)

KING: He's a fellow Massachusetts guy. He was a great guy. He just didn't quite get there, but that's -- Carville ran a good campaign, which is sometimes you've got to give credit to the guy who runs a good campaign and a good candidate. All right, we got to take a quick break here.

We'll pick this conversation up another day. When we come back, the latest on the WikiLeaks founder Julian Assange, he is in prison no more.

(COMMERCIAL BREAK)

KING: Welcome back. Let's check in with Joe Johns for the latest news you need to know right now -- Joe.

JOE JOHNS, CNN SENIOR CORRESPONDENT: John, WikiLeaks founder Julian Assange walked out of London's high court to a cheering crowd today after being freed on bail. Assange is wanted in Sweden over alleged sex crimes there.

Here in Washington more than 100 protesters were arrested at a rally outside the Whitehouse to support WikiLeaks and protest the wars in Iraq and Afghanistan.

The Food and Drug Administration is recommending that the popular breast cancer drug Avastin no longer be used for the treatment of the disease saying dangerous side effects may outweigh any benefits.

And those of you who follow Twitter might have been as surprised as we were to learn that CNN allegedly reported Morgan Freeman had passed away this afternoon. Well, it was a hoax. We didn't report that and Morgan Freeman's spokesperson told us he is very much alive. CNN is aggressively investigating the hoax, so he joins a growing list of famous people who get done that way --

KING: Yes -- for all the charms and the wonder of social networking and technology. The way you can anonymously say CNN this or XYZ that or somebody reports that. That's the dangerous part of it, so don't always believe it. Check it out especially if it's controversial and Mr. Freeman is still with us. We can't wait for the next movie -- Joe, thanks.

A lot more to come in the program tonight including a conversation with Senator John McCain, he's a key player in many of the key debates on Capitol Hill. Will the START Treaty pass? What about "Don't ask, don't tell" -- Senator John McCain "One-on-One" when we come back.

And this is a special day here at CNN. We'll call it "Larry King Day"; it's the end of an era. Our good friend wraps up his final live broadcast tonight. We'll show you some facts and figures about a remarkable, remarkable staying power of Larry King.

And "Pete on the Street" tonight, he wants to know this. Will Congress be home for Christmas? Maybe he's going to make a bigger turkey. Stalling tactics -- does Pete like them or not? We'll find out.

(COMMERCIAL BREAK)

KING: To hear Senate Democrats, Republicans are using stalling tactics to block votes on several important policy issues in this year-end congressional session. Well Republicans see it differently. They say what they're doing is demanding time for open debate and they see Democrats pushing what our next guest calls a liberal wish list designed to curry favor with Democratic interest groups.

So what will pass and what will stall in the lame duck session? Let's get the sense of Arizona senior senator, Republican John McCain.

Senator, it's good to see you.

I want to start with an issue that I know is critically important to you, and that is the new assessment of the Afghanistan war strategy that came out today. You've seen the strategy. You've been to the region many times and you heard from the president today. The president says he believes the troop surge and the idea that the drawdown will begin in 2011 is one of the reasons he thinks things are working better. I saw your statement where you say don't focus on a date, focus on progress on the ground.

I want you to listen here, though, to the vice chair of the Joint Chiefs, General Cartwright. Does this concern you?

(BEGIN VIDEO CLIP)

GEN. JAMES CARTWRIGHT, VICE CHAIRMAN, JOINT CHIEFS OF STAFF: What they've said is that at 2011 to 2014 there is a drawdown. What is being negotiated and what will be adjusted is the rate of that drawdown. Troops will come out.

(END VIDEO CLIP)

KING: Troops will come out. He's adamant about that. Is that all right?

SEN. JOHN MCCAIN, (R) ARIZONA: General Cartwright, I don't know where he's coming from but I've always said if the enemy thinks you're leaving, they are going to wait you out. I hope that we made very clear the operative year is 2014.

KING: Let's move on to another big national security issue. The Senate is considering the START Treaty, a nuclear arms reduction treaty that the president negotiated with Russia. I know you've had some questions about the missile defense aspects of that, but I want you to listen to one of your Republican colleagues Jeff Sessions, on the floor today.

Yes, the United States would reduce its nuclear arsenal under this treaty, but I want you to listen to Senator Sessions and tell me on the other side here do you believe the cuts are so severe what he says is actually possible?

(BEGIN VIDEO CLIP)

SEN. JEFF SESSIONS, (R) ALABAMA: If Iran and North Korea risk their security and their financial futures on building a nuclear arsenal today, will our example cause them to stop? I think not. Rather, I must conclude it will embolden them and could even embolden others.

(END VIDEO CLIP)

KING: Is that a fair statement, Senator, in the sense that even if you have all the cuts included in this treaty, the United States would still have the largest or second largest nuclear arsenal in the world?

MCCAIN: I agree with Senator Sessions particularly in the area where I don't believe that another START Treaty would have any beneficial effect on other rogue nations that are attempting to acquire, or have developed nuclear weapons, such as North Korea or Iran.

But, having said that, I don't think it would embolden them either. I think that this treaty is going to stand or fall on its own merits. And as you mentioned my concerns are about missile defenses, both in the preamble of the treaty, the signing statement that the Russians made that any improvement that we might make in missile defenses in Europe would be grounds for them aggregating the treaty.

But, again, I don't think whether we ratify the START treaty or not is going to affect Iranian or North Korean or other rogue nations' behavior in the slightest.

KING: You have been saying in recent hours, to the Tea Partiers out there, pick up your pitchfork. So you have long been a critic of earmarks. Long before there was a Tea Party John McCain was railing against earmarks. When the Democrats brought forward this 1,900-page bill you jumped on it. You said it was an outrage. I want to be clear. There are loads and dozens and dozens of Republican earmarks in there. And my understanding of it, is any of the Republicans could have gone to the Appropriations Committee and said, look, we just promised not to have these earmarks so take mine out, yet they're still in there. Is this a bipartisan plague?

MCCAIN: It is a bi-partisan plague. And we have Republican senators who may vote in favor of this atrocity-monstrosity and atrocity. By the way, I was speaking rhetorically when I said go pick up your pitchforks. Let me make that clear.

But, look, this is really a total contradiction, an abrogation of the commitment and the message of November the 2nd. And we Republicans have got to understand, we have a second chance because of our excesses of the Bush administration and I'm not sure they will forgive us another time. And you saw the approval rating of 13 percent. You can't get much lower. If we do this to them, I don't know where it goes. Down to blood relatives and paid staffers.

KING: "Don't ask, don't tell" is a big debate on the Senate floor. It is also a bit of a debate within your own family. Your daughter Meagan was on MSNBC last night. And she said this is the civil rights issue of her generation. Can you now vote, after listening to the Pentagon, after listening to everybody else, will you now vote to repeal "don't ask, don't tell" and allow gay Americans to serve openly?

MCCAIN: John, I paid very close attention to our military leaders, as I said I would. A commandant in the Marine Corps says it will cost lives of Marines. The chief of staff of the Army said that it could cause disruption and he is opposed to doing it this time. The chief of staff of the Air Force said, at least wait until 2012. So our military leaders have spoken fairly strongly three out of the four service chiefs. They are military leaders. So what I'm hoping is we can turn this back now, look at a path in the future, that when it's right to do so, we're in two wars. And I believe that right now would not be the right time to repeal it, and that's my position, and I will hold it.

KING: You mentioned the commandant of the Marine Corps, Senator, I ask this next question not to be disrespectful, but because I know you as someone who takes the long trips, who does the research, who talks to the troops, as well as their bosses. You mentioned the commandant of the Marine Corps, he is against this. Your son has been in the Marines, he has served on the front lines. And this is a often a generational issue. Older Americans have a harder time with this than sometimes younger Americans. What does your son think about this?

MCCAIN: You know, my son is now out of the Marine Corps. The proudest moment of his life is having serving in the Marine Corps. His words to me, as so many thousands of others' words have been to me, it isn't broke, don't fix it.

KING: So he wants to keep it just in place as it is right now?

MCCAIN: They believe that it is working and I'm very reluctant to discuss my children's views.

KING: I understand that. I ask only because of his service, and you mentioned the commandant.

Let me ask you lastly, Senator, after the presidential election there was some talk that once the wounds healed a little bit, that you would have a relationship with President Obama, perhaps be someone he reached out to, what do the Republicans think? Perhaps help him especially on these security issues. When we come back in January, the Republicans will control the House and the Republicans will just be short of controlling the Senate. So the president is going to need some help. He will have to reach out more. What's the status of that relationship? Does he pick up the phone now and call you, and maybe we don't know about it. Do you have any sort of a back and forth that could be helpful to both of you in this new environment?

MCCAIN: Well, I did have a conversation with the president about the issue of START And how to go about it, and it was a very cordial conversation, I think. But I have not had any other conversations but I look forward to working with him. I had a meeting with his new national security adviser and we covered a lot of bases. I look forward to working with the president and his new national security adviser. As you know, I am a great admirer of the secretary of Defense so we have certainly good grounds for cooperation in a very dangerous world.

KING: Senator John McCain, as always, appreciate your time, sir.

MCCAIN: Thank you.

KING: Take care, Senator. When we return, tonight's top stories and the end of an era.

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN BREAKING NEWS.

KING: Breaking News just in to us here at CNN. A big deal, a major agreement and a major change of strategy by the Senate Democrats now. We can show you live pictures, the Senate is still in session . That's the Republican leader Mitch McConnell. Just moments ago, the majority leader, Democratic Harry Reid, announced the Democrats were abandoning their plan to pass the omnibus spending bill, that giant 1,900-page, $1 trillion budget plan. They want it to pass in the final days of this Congress. Leader Reid, because of the Republican objections coming to the floor moments ago, saying they will pull that bill from the floor. Remember, it was $1 trillion, $8 billion in earmarks in there. That generated a lot of controversy.

Democrats now agreeing to pull that form the floor. Leader Harry Reid, the Democrat, says he will work with his Republican counterpart on what is called the continuing resolution, that is a shorter, more vague plan to keep the government funded into the new year. We'll continue to track this debate as it plays out now live in the United States Senate. Right now let's check in with Joe Johns for other news you need to know right now.

(NEWSBREAK)

KING: He is a legend. He is an institution at this network. He is, above all, a gentleman. It's been great to work with Larry these last 13 years. Larry is not going away. He's going to do specials for us from time to time.

More on Larry in just a second. But, Joe, while I still have you I just want to get your sense here. This is another win for the Republicans?

JOE JOHNS, CNN CONGRESSIONAL CORRESPONDENT: Absolutely.

KING: Democrats wanted to push this plan through. It's 2,000 pages, at a trillion dollars. More specific, almost a budget. Now they have to cut a deal with the Republicans on a C R, as we call it in Washington. Essentially it means not a detailed budget. JOHNS: One of the fascinating things you started talking about yesterday, and the day before, is there are a number of Republicans who actually have earmarks in this big bill. And now they're having to come out and sort of an awkward position and say I'm going to vote against this bill even though I have my own earmarks. So it's put a lot of different people in unusual positions.

KING: All of those Republicans saying I was for them before, and now I'm against it. That's right, Joe. We'll keep on top of that story.

Let's reflect for just a moment on the remarkable career of a CNN institution. All right. Let's look back a little bit. Man, look at the light set there.

Now, Joe, can you answer these questions? When did it debut? Who were the first guests, and what were the other big premieres back in 1985? If you are taking notes at home, let's take a look.

June 1985, New York Governor Mario Cuomo was Larry's first guest. Other shows that premiered, that year, "The Golden Girls", "MacGyver". Larry has had more staying power than those guys.

Let's take a look at this as well. Ready? Try this at home. Get your pencil. What do these numbers mean, 53, 40,000 plus, nearly 10,000. Have your answers ready. Here we go, 53 years in broadcasting, Larry on the radio before he came to CNN, of course. More than 40,000 interviews conducted by Larry King. Nearly 10,000 hours here on CNN. That is a remarkable legacy for Larry. Here is something else. Here is how you know Larry has a lot of pull out there; 1.7 million followers for Larry on Twitter; 1.9 for the president of the United States. Larry is in pretty good company there.

He has a great following out in America. That will continue. And more than 8,100 light dots on the original Larry King set. Again, Larry is an institution. We wish him the best. He's leaving the 9:00 hour. Piers Morgan gets that. Larry King will stay working here for CNN on specials. What do you get when it's all over? You get a great rap party. Take a look. There's the red carpet, that is Spagos, Los Angeles. A party for our friend Larry King tonight.

Joe, it's too bad we're stuck here on the East Coast.

JOHNS: You've got that right. That's amazing.

KING: Take a peek at that and we'll be back.

(COMMERCIAL BREAK)

KING: The president today released an update, an assessment, of his Afghanistan/Pakistan strategy. Let's take a closer look and let's start with this. What our current U.S. troop levels are. When the president became president, when he was inaugurated, with 34,400 troops. You see the surge under President Obama, we are up to 95,000 U.S. troops in Afghanistan today. That's about twice the number of troops in Iraq now as the Iraq number comes down, the Afghanistan number has gone up. Important to remember. The question is, is that troop surge working? Look at the map here and let me explain the colors for you. If you see a dark green here, this is an independent province in Afghanistan, being run by the Afghans. If you see the yellow, that means they have effective Afghan government with the help of some advisers. The orange is effective with some assistance from coalition partners. The red are the trouble spots in Afghanistan. That means effective only with coalition forces and you se it's a good chunk of the country including up here in the border with Pakistan area, over this way.

Important to keep the Taliban back is to control these areas here. The red shows you the significant challenges still ahead and, remember, as you deal with the challenges on this side of the border, a lot of it is coming across this way. And you have to deal with the stability issues in Pakistan. That's one way to look at the challenge.

Another way to look at it is this way. With the increase in U.S. Troops have also come a dramatic increase, in 2010, in the attacks there, the more troops, the Taliban fighting back to a degree. That underscores the challenge. The higher number of the attacks right here. Still, the president today at the White House saying, it's a tough road but he believes the new strategy is working.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Progress comes slowly and at a very high price in the lives of our men and women in uniform. In many places the gains we've made are still fragile and reversible. But there is no question we are clearing more areas from Taliban control and more Afghans are reclaiming their communities.

(END VIDEOTAPE)

KING: So do key members of Congress share the president's assessment? And will he get their support for his plan going forward? Let's head up to Capitol Hill, we are joined by two key members, Keith Ellison of Minnesota. He is an opponent of this war. And Mike Rogers, Republican of Michigan. Next year will be the chairman of the House Intelligence Committee.

And because of that, Congressman Rogers, let me start with you. We heard from the president today. You have in front of you now, his assessment. Folks I've talked to in recent days essentially say this. The troop surge has gone pretty well. The troops are doing a great job to the degree they can. But Karzai is still corrupt and unreliable. And on the Pakistan side we still can't get a consistent effort against the Al Qaeda, up in the border regions. Is that a fair assessment?

REP. MIKE ROGERS, (R) MICHIGAN: Yes. It really is. I would also put in there, John, the Iranians are controlling a lot of commerce on the western side of Afghanistan, that has been pushing Karzai into the hands of Ahmadinejad here for the last probably 18 months, so you have all of those dynamics happening all at the same time. KING: And with those dynamics happening, Congressman Ellison, does the president then deserve the funding to continue this strategy, or is it time to say, it's not working?

KEITH ELLISON, (D) MINNESOTA: I remain very skeptical, John. I mean, I have been from the beginning. I do think that what our policy should be to focus on disrupting, destroying Al Qaeda. We hear today that they're further deteriorating and a year ago we heard there were only 100 of them in the country. I think what we need to do is to have a counterterrorism strategy there. And to join with the international community to try to help Afghanistan build its own country up. But we have to see Afghanistan in the picture in a larger global picture, and as we fight terrorism, and I think our military presence there may not be contributing positively to the larger fight going on around the world.

KING: Does that mean end the military presence there as soon as possible?

ELLISON: I'm not a supporter of the military presence there. I'm a supporter of our troops there and I agree with Congressman Rogers that, yes, if you tell our soldiers to clear out an area, they will clear it out. They're good at what they do. But how does it figure into the larger picture trying to suppress terrorism in many places around the globe, including the United States.

KING: Congressman Rogers, here is the problem, I guess, as least in my take, and tell me if you disagree. You still do have the Taliban trying to come back into power. You still do have some Al Qaeda presence in Afghanistan, more across the border in Pakistan. So, you see the reason for the mission there, obviously, and yet what confidence do you have in the next several years? The president wants this all over by 2014, that we will somehow be able to make the progress with good governors, with training the Afghans that we have been unable to make the past nine years?

ROGERS: Here is, I think, the bigger problem, John. The political effort, the diplomatic effort and the military effort are not aligned yet. That has caused a tremendous amount of problems. You are right, you go tell the military to go take Kandahar, they will take Kandahar, and they will hold it as long as you tell them to hold it. And they will do a phenomenal job. But if the diplomatic effort and the political effort, both here at home, and there, aren't aligned, those troops will never be successful. And I argue that they have not aligned all three of those efforts, at the same time. And I do believe that if they do, you can probably have a smaller troop footprint that targets Al Qaeda. That targets the areas of the cross border operations where Taliban finds safe haven in the tribal areas of Pakistan.

And I would argue you'll still have to have a pretty aggressive engagement with Iran when it comes to their efforts in the western part of Afghanistan. They're up to no good there. And by setting this artificial timeline, which is a political equation, you tell Karzai, gee, we're going to be gone soon. Who's your biggest friend in the neighborhood? It is Iran, right on their border. So all of these conflicting problems between the political and the diplomatic and the military are causing us I think a delay in a successful mission in Afghanistan.

KING: What would your solution then, sir, be with the problem of Iran? How do you deal with it?

ROGERS: Well, on the Iranian problem-first of all, let me back up. You need to stabilize the Taliban efforts in Iraq. I argue you can do that with a smaller footprint. You need to encourage Pakistani efforts in the tribal areas, and we need to be aggressive about that border region, the Duran (ph) line, where the Taliban does find safe haven, where the Shira (ph) council meets in Quetta (ph), all of those things need to be aggressively pursued. And at the same time you need to tell Karzai, and it is broader than Karzai, tell the people of Afghanistan, we're not going to walk away in July, or whatever it is, just because that's the timeline. We are going to leave when you're ready to take over and build your own country.

And until we get all of that lined up, you will have problems. It is confusing. They don't know if when we're gone the Taliban isn't going to be large and in charge. Certainly on the western part of Afghanistan, the only commerce, the only place to get 24-hour electricity because the Iranians run it across the border. All of those allegiances are incredibly important to people who are trying to make it in a pretty tough neighborhood.

KING: Congressman Ellison, you just heard Congressman Rogers say you can't have an artificial deadline. We have to get this done, work at it as hard as we can, as quickly as we can, but don't set a date on the calendar. Come out when it is working. The president said today he thinks the progress has been because of his commitment to start a withdrawal next year, a draw down next year, ultimately get out in 2014. And one of your Democratic colleagues, Jane Horman, who is usually a lot more hawkish, than Congressman Ellison, I would say, she said this, "We need a clear public timetable to end our military mission in Afghanistan responsibly and soon." Sounds like she wants to go more quickly than the president. Who is right?

ELLISON: I think Jane is right on this, and I think 60 percent of the American people agree with her. The fact is, is there are people in Afghanistan who would like us to be there forever so the American troops can do their fighting for them. Afghanistan is a sovereign nation. They need to stand up quick. They need to deal with corruption, deal with developing their country and they need to deal with their security.

And on the issue of diplomacy, I'd also like to add that one of the things that I hope we begin to do is we begin to engage India more constructively on this equation. We shouldn't just have an Af-Pak policy, we need an Afghanistan-Pak-India, so that we can really get all the players in the region, and include Iran to try to bring real stability to this region, otherwise it's a sinkhole, it is a quagmire. And as many writers have famously said, it's a graveyard of empires, and I don't want my country going down that hole.

KING: Congressman Rogers, Congressman Ellison, appreciate your time today, Sirs.

ELLISON: Thank you, John.

KING: Thank you both.

ROGERS: Thank you.

KING: We called Pete Dominic our off-beat reporter. But sometimes he is just like you. He looks at Washington and doesn't quite understand what's going on. Pete, after the break.

(COMMERCIAL BREAK)

KING: Tonight Mr. Dominic asked that I refer to him as Populist Pete On The Street. To which I say, Why?

PETE DOMINIC, POPULIST PETE ON THE STREET: John King, I'm speaking for all Americans tonight when I say, that last night we talked you and I about the 13 percent approval rating of Congress. Maybe it's because Kyl and Reid fighting about who loves Christmas more, John King.

I mean, there are a lot of Americans who aren't going to have a Christmas this year and they arguing whether or not they are going to have to work on Christmas. I don't hear the troops complaining.

My question to you, John King, the thing that is fired me up. A lot of these senators are going away. Blanche Lincoln and Kitt Bond both made farewell speeches. When senators are making farewell speeches, is nothing getting done, legislatively? That is my question?

KING: Sometimes committees are meeting, sometimes they are negotiations happening. They can do a lot of things at once. Tonight they pulled the big, huge spending bill. They are going to work out a compromise, instead. It is not pretty, Pete. It's not pretty. We'll see if it works? Populist Pete, we'll see you tomorrow.

DOMINIC: I hope so.

KING: We'll see you, too. "PARKER SPITZER" right now.